News Flash- BoA Settlement Expensive But Quick, Vice Chair Says
April 26, 2004
The $675 million price tag agreed to by Bank of America and FleetBoston to settle charges in the mutual fund scandal was extremely high, but the companies agreed that expeditious handling of the charges was paramount to closing their merger, the vice chairman of BoA said in a recent CNBC interview.
"Was it a little higher than we wanted?" Vice Chairman Jim Hance asked. "Of course, way higher than we wanted. But we also think it was the right thing to do to get it behind us so we could focus on our company going forward."
The $675 million settlement figure is the aggregate number between the two companies after an extra $160 million of fee reduction promises were tacked on by New York Attorney General Eliot Spitzer. Bank of America felt the bulk of the original $515 million settlement with the SEC, paying $375 million in fines and restitution, compared to Fleet's $140 million.
Soon after the firms' merger was approved, Bank of America announced it was cutting 12,500 jobs over the next two years.
Of the settlement amount, Hance added he was pleased that much of the money would be stashed into a restitution fund.
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